U.S. markets are pointing to a mixed open on Monday as oil prices climb due to a seeming stalemate over the Strait of Hormuz.
Futures for the S&P rose 0.2 per cent, while futures for the Dow Jones Industrial Average fell 0.14 per cent. Nasdaq futures were up 0.14 per cent before the opening bell.
Iran insisted that the U.S. meet its demands in negotiations before the Strait of Hormuz reopens. Details emerged on the potential deal between Iran and Oman on managing the Strait of Hormuz as Tehran suggested that vessels linked to “hostile countries” would be barred.
Brent crude, the international standard, gained 1.4 per cent to US$84.68 per barrel. U.S. benchmark crude advanced 1.4 per cent to US$79.30 per barrel.
“Negotiators said that a deal to establish a safe shipping route was close, but Iran may now be exploring just how much it can extract from the U.S. in return,” Bas van Geffen, senior macro strategist for Rabobank, wrote.
Inflation will be the focus this week in the U.S. with new data from July landing midweek. The Labor Department releases its consumer price index Wednesday, with economists expecting a slight easing from June. On Thursday, the U.S. posts July data on producer prices, or costs that are in the pipeline before goods reach consumers.
In U.S. markets before the opening bell, the energy sector is rising in tandem with the price of oil. Marathon, Occidental and Valero were the biggest gainers.
On the other side, cruise lines like Carnival and Norwegian, as well as hotels and travel booking sites, fell with the cost of fuel expected to rise.
Tech stocks are also on the rise after a weak jobs report Friday raised the odds that the Federal Reserve would hold off on an interest rate hike at its next meeting. The fast-growth tech sector is reliant on cheap access to credit and there have been expectations that the Fed was leaning toward raising borrowing costs to combat inflation.
Shares were mostly higher in Europe and Asia, with Japan’s Nikkei 225 leading advances.
The U.S. dollar rose to 158.80 Japanese yen from 157.72 yen. The euro fell to US$1.1552 from US$1.1561.
Elaine Kurtenbach And Michelle Chapman, The Associated Press
